News

London has lost all of yesterday's gains, with resource stocks primarily responsible for heavy losses on the Footsie.

Double digit percentage falls are the norm for miners, with the sector out of favour as metal prices slide. A broker downgrade for the sector has further soured sentiment, as has a price target cut by Royal Bank of Scotland for Xstrata.

Rio Tinto loses around one-eighth of its value after saying it will reconsider the timeline of the first wave of its proposed sale of assets. The company also warned that the Chinese economy is "pausing for breath" and growth in the Chinese economy this year is expected to below 10%, down from almost 12% last year.

Weakening oil prices are hitting the oil sector, while oil services providers such as Wood Group are dealt additional blows by bearish comment on the sector from Morgan Stanley.

Lloyds TSB is bucking the trend on talk the government may have to allow it to set its own dividends or risk the merger deal with HBOS unwinding. Royal Bank of Scotland is also higher on talk that it too will want a similar dividend concession if Lloyds gets it.

Diageo has kept its guidance for full year organic operating profit growth of between 7% and 9% despite the recent plunge in global stock markets and looming recession. The Guinness brewer and Smirnoff vodka group said organic net sales growth in the three months ended 30 September 2008 was 6%.

Autonomy's bumper profits have seen it move forward along with Pearson.

As it forecast recently, the data search software giant's third quarter figures came in right at the top of forecasts. Autonomy's profit before tax jumped 160% to $47.9m from $18.3m on revenues up 42% at $127.1m, driven by strong organic growth.

FT publishser Pearson is receiving a boost to profits from the resurgent US dollar. The group said that if the recent strengthening of the greenback versus sterling is maintained, full-year adjusted earnings per share are likely to be at the top end of current market estimates. Sector peer Reed Elsevier rises in sympathy.

Elsewhere, strong demand for armoured cars is keeping weapons group BAE Systems on track this year. "Anticipated growth outlook for 2008 is benefiting from the high demand for armoured wheeled vehicles in the group's land & armaments business. The group anticipates a return to operating cash inflow in the second half year," it said in a statement.

Growth accelerated during the second quarter at credit checking firm Experian, lifting revenues for the half year by 13%, with organic growth of 3% helped by 5% growth in the second three month period. "We remain vigilant on costs and are focused on driving profit growth," said chief executive Don Robert.

A resilient performance at Marston's leaves the pub group predicting earnings before exceptional items for the year to 4 October will be in line with expectations after benefiting from a slightly reduced tax charge. Like-for-like sales at the managed pub division were 0.6% below last year, while the tenanted and leased pub division saw like-for-like profit drop 1.7% below 2007, including a fall of around 3% in the second.

Fund manager BlueBay has floated higher after revealing estimated assets under management at the end of September were $20.5bn, up 3.2% before adjusting for exchange rates, with net subscriptions of $1.9bn received during the quarter, partially offset by $1.3bn of fund depreciation.

Among the small caps, betting shop software group Alphameric's trading conditions in its bookmaking display and systems business have tightened in recent weeks and that the division is currently trading behind management's expectations.

Inkjet printing technology group Xaar is laid low by a profit warning. The group said lower sales in China will reduce third quarter revenues and profits.